PPG to lease West Virginia property for natural gas drilling

28 February 2011 15:15[Source: ICIS news]

HOUSTON (ICIS)--PPG Industries plans to lease property at its Natrium chemicals site in West Virginia for the development of Marcellus Shale natural gas, the US coatings and specialty products producer said on Monday.

PPG said it leased drilling rights on the property to Houston-based Gastar Exploration, which plans to drill more than 30 wells on the site beginning in the third quarter of 2011.

“PPG estimates the net present value of the future before-tax cash flows generated by this lease will total approximately $50m [€37m] over the life of the anticipated well development, which is estimated to be over 30 years,” the company said. “This includes an initial cash payment of approximately $10m.”

Gastar chief executive Russell Porter said, “Along with our existing leasehold in Marshall and Wetzel counties, these leases help Gastar create a large, contiguous block of acreage that can be efficiently and profitably developed for the benefit of PPG’s and Gastar’s shareholders.”

US pipeline operator Dominion said on 12 January it reached an agreement on an option for land at PPG's Natrium site to process natural gas from the Marcellus field.